The company yesterday announced its intent to acquire Ocean India Ltd., further to the disclosure made last February with regard to the initiation of independent valuations and due diligence studies with a view to acquiring a controlling stake in that company. Ocean India Ltd. is a knit fabric manufacturing operation in Visakhapatnam, India (Ocean India).
The Board of Directors of Textured Jersey Lanka PLC (TJL) has now decided to acquire, subject to obtaining the necessary corporate and regulatory approvals therefor, the entirety of the issued shares of Ocean Mauritius Ltd., a company incorporated in Mauritius which is the parent company of Ocean India.
TJL, which has maintained a strong balance sheet owing to sound business performance, will pay a total consideration of $ 15 million to the selling shareholders, Brandix Group, Jacob BAC Ltd., Compagnie Mauricenne de Textile Ltee and Pioneer Elastic Holdings Ltd. The consideration is to be paid in the form of 50% cash and the balance 50% by the issue of shares in TJL to the selling shareholders.
The Board of Directors of TJL has decided to issue, subject to obtaining the necessary corporate and regulatory approvals therefor, 35,197,368 ordinary voting shares of TJL, by way of a share swap, to the selling shareholders in consideration of the transfer of 17,815,000 shares in Ocean Mauritius, to TJL, by the selling shareholders. The share swap is subject to the Colombo Stock Exchange approving in principle the issue and listing of such shares and the obtaining of shareholder approval at a general meeting.
Prior to this takeover, TJL had also acquired Quenby Lanka Prints Ltd., and the new acquisition will place the company on an altogether different platform. Already a formidable player in the textile industry, TJL will thus become the only Sri Lankan-based multinational fabric mill and the lead player in South Asia.
Commenting on this move, TJL’s CEO Sriyan de Silva Wijeyeratne said: “The solution flexibility Textured Jersey now possesses will bring significant benefits, shorter lead times and stronger innovation capabilities to our growing customer base. Shareholders too should see greater synergy and long term growth prospects as a result of these bold moves.”
The Board of Directors also announced that TJL has been informed by one of its major shareholders, Pacific Textured Jersey Holdings Ltd. (Pacific), which presently holds 39.65%of the issued shares of TJL, that Pacific proposes to sell a part of these shares amounting to approximately 10% of the total issued shares of TJL.
TJL has also been informed by Pacific and Brandix, the two major shareholders of TJL, that Pacific and Brandix are, pursuant to an agreement reached between them, acting in concert within the meaning of the Company Takeovers and Mergers Code 1995 and that Pacific and Brandix have agreed to maintain a collective shareholding in TJL of not less than 51% of the issued shares thereof, for a period of at least five years.
The strong long term commitments by Sri Lanka’s leading apparel exporter Brandix, and one of Asia’s largest fabric mills, Pacific, are bound to ensure that TJL will receive the stewardship and strategic insight to continue its growth momentum. These moves will also provide other shareholders and the public with greater opportunity to be part of the TJ’s exciting future.
“With the GSP Plus conversations in the background, local production would expect to benefit from any decision which may transpire in the times ahead,” says the CEO.
Incorporated 15 years ago, and now listed on the Colombo Stock Exchange, TJL leads the Sri Lankan fabric industry through innovation and sustainability, and is amongst the LMD top 50 companies in Sri Lanka. The company supplies to some of the best international brands including Marks & Spencer, Victoria’s Secret, Intimissimi, Tezenis and Calvin Klein.